How to Compare Annual Fee Credit Cards
July 29th, 2010
The term no annual fee can mean several things. In order to find out how to compare annual fee credit cards versus credit cards without any annual or yearly fee, you must first become acquainted with terminology used by the various credit card issuers.
Credit cards without annual or yearly fees can save you a lot of money. The annual fee on many cards start around $50 and can run up to several hundred dollars on some cards. Most cards that offer no annual fees will come with a higher interest rate than those that do charge an annual fee. Also, many of the credit cards without annual or yearly fees are no frills cards, and do not offer a rewards programme.
If, however, you are someone that only uses the credit card in case of emergency or you are the type person that pays the balance off monthly, you may find that a card without an annual or yearly fee is for you.
If you tend to roll over balances from month to month, you may be better off choosing an credit card programme that carries a lower interest rate but has a yearly fee. Also these cards may be best for someone who is interested in a rewards programme, even though there are some platinum cards that have no annual or yearly fees, that offer a rewards program of some sort.
Three Kinds of No Annual Fee Cards
In learning how to compare annual fee credit cards, you need to know about the no annual fee cards and exactly what this may mean to you. There are basically three types of credit cards without annual or yearly fees, with the meanings explained below.
- No annual fee for life credit cards – If your card says that there are no annual or yearly fees ever, that means that particular card will have no annual or yearly fees for life. It is best to read the card application to be sure that the card company will hold to this agreement.
- No annual fees for the initial year – Under this agreement, annual or yearly fees will be waived for the very first year. Be sure you are aware of what the yearly fees will be the next year and every year thereafter. This is where learning how to compare annual fee credit cards with no annual or yearly fee cards comes in handy. Is the no yearly fee for the first year going to justify the pursuant yearly fees along with the higher interest rate? Only by comparing the two will you know.
- No annual fee discounts – With this agreement, the yearly fee will be waived if you spend a certain amount annually with the card. If you intend to use the card enough to qualify for this waiver this can be a good deal. However, if you are not going to spend the required amount with the card to get this waiver, you may be more interested in a credit card with lower interest which does charge a yearly fee.
As you compare yearly fees or no yearly fees, take into consideration the other costs of owning the card, such as interest rate, balance transfer rates and cash advance rates. The annual or yearly fee is only one part of credit card ownership.
Editors Choice: Best Credit Card Deals
| Credit Card | Card Details | Interest Rate p.a. | Cash Advance Rate p.a. | Balance Transfer Rate p.a. | Annual Fee | Interest Free Days (Up To) | |
|---|---|---|---|---|---|---|---|
|
An excellent balance transfer offer of 1.9% p.a. for 12 months and a standard purchase rate of 12.24% |
12.24% | 17.99% | 1.9% for 12 months | $39 | 0 | |
|
Excellent credit card, with a 0% p.a. for 6 months balance transfer offer, and pay $0 for the life of the card |
16.99% | 20.75% | 0% for 6 months | $0 | 55 | |
|
Enjoy 1.9% p.a. for 12 months on balance transfers as well as earn 3 Skywards Miles for every dollar spent, plus all the benefits & privileges of a platinum card. |
20.74% | 20.74% | 1.9% for 12 months | $229 | 55 |